How does a PRSA work?

PRSAs are pension contracts between you and a PRSA provider such as Irish Life. PRSAs make it easier to save for retirement as they offer value for money, flexibility and convenience. Whether you are an employee or self-employed a PRSA helps you save for retirement. And if your employment status changes or you move to a new job you may be able to bring your PRSA with you.

Contributions

You invest either regular contributions or one-off contributions, or both. Most people choose regular contributions because it is easier and smoothes out the cost. If you are an employee and are not in a pension plan at work, your employer could also contribute to your plan.

Tax relief

To encourage people to save for retirement the Government provides significant income tax relief on PRSA plans. If you are an employee or self-employed then you may then be able to claim income tax relief on your PRSA contributions. You can pay as much as you like. However income tax relief is only available on contributions up to a fixed percentage of net relevant earnings depending on your age

Growth

We then invest your contributions (less any contribution charge) in a fund where any growth achieved will not be taxed until you take your benefits.

Retirement Fund

Finally, you’ll hopefully have built up a big enough fund for your retirement. Normally, you can take your benefits between the ages of 60 and 75, but there are certain exceptions. At that stage, you’ll have a number of choices in terms of what you want to do with that fund. Go to our retirement options page for more information.